HC Deb 13 March 2000 vol 346 cc108-15

9 pm

Mr. Stunell

I beg to move amendment No. 177, in page 13, line 12, after "must", insert "either—(a)".

Mr. Deputy Speaker

With this, it will be convenient to discuss the following amendments: No. 178, in page 13, line 16, at end insert— '; or (b) where there is an approved federal party structure have overall responsibility for—

  1. (i) the financial affairs of the federal party and for ensuring compliance with the provisions of Parts III to V and VII, and
  2. (ii) notifying the Electoral Commission of the duly authorised treasurer of every other approved constituent part of the party.'.

No. 179, in clause 22, page 14, line 17, at end insert— '(5A) Where a Party seeks to register an approved federal structure, it must demonstrate to the satisfaction of the Commission that its constitution includes specific provision for two separate bodies with responsibility for the same geographical area, where one of those bodies (the "Federal Party") has powers and duties relating to the whole of one or more of England, Wales, Northern Ireland and Scotland, and where each party has

  1. (i) wholly separate functions, powers and duties, and
  2. (ii) no duty either to approve accounts or submit accounts to the other.'.

No. 181, in schedule 8, page 123, line 43, at end add— '(6) Where a party has an "approved federal structure" any reference to any national spending limits or accounting limits contained in Part V and Part VII Chapter II shall be deemed to be divided into two equal parts, with one part allocated to the "Federal Party" and the second part allocated to the "other approved parties"; each of the other approved parties shall have as its relevant expenditure and accounting limits that proportion of the second part of such limit as the number of parliamentary constituencies within the geographical area covered by that party bears to the total number of constituencies within the United Kingdom.'.

Mr. Stunell

All the amendments are part of a package that is designed to secure a particular possibility for the Liberal Democrats especially, and perhaps for other parties with a federal structure. We make it absolutely clear that there is no intention in any way to water down or debase the Bill as a whole. It is our strongly held view that the Bill needs to be enforced quickly, and that it needs strong provisions to safeguard the public and to ensure that abuses that have arisen on party political funding are eradicated.

I think that the Minister and other Members recognise that the Liberal Democrats have, throughout progress on the Bill, strongly supported the restrictions, the reporting requirements, the introduction of transparency and other provisions. However, we have a particular problem. At each stage at which it has been raised, the Minister has been sympathetic to our cause. We have had a meeting and an exchange of correspondence. I hope that the debate will advance that argument a little further.

Mr. Tipping

I am grateful for the hon. Gentleman's generous comments. The door is still open. There is a need to make further progress on the matter. At the very least, I hope to offer him and his colleagues further discussions on the point.

Mr. Stunell

I welcome what the Minister has said. In all honesty, it is very much of a piece with his approach throughout the Committee stage. It is much appreciated.

I do not want to detain the House for too long, but it is such an important issue for us that I want to get it on the record and to say how we see the way ahead. The Bill makes provisions for parties that are structured in the first place as unitary parties—parties that are homogenous in structure throughout the United Kingdom, or at least throughout the constituent parts of the UK, in many cases excluding Northern Ireland.

Within the unitary party structure, the Bill makes provision for separate accounting units. Those might be local constituency parties, or wider groupings of constituencies, regions or states, but, in essence, there is a pyramid structure, with a reporting line going from the lowest level to the top of the pyramid. In terms of the Bill, that is the party treasurer, who takes the ultimate rap if there is any difficulty or any breach of the Bill at any level within the party. As a result of discussions in Committee, an alternative structure is permitted under the Bill: a confederation of different geographical units, each of which is, in essence, a separate party. There might be a party for Scotland, for Wales, for England and perhaps for Northern Ireland.

Both those models are clearly catered for in the Bill, or in the amendments that the Government have spoken of, but the difficulty is that we have a different structure—a federal structure. That is neither widely admired nor widely understood in the House. I understand that clearly, but I am not inviting the House to convert to federalism. I simply invite it to permit us to continue to practise our minority sport in that regard.

Although federalism is a somewhat unusual concept in the House and in the United Kingdom, it is far from being an unusual concept in democracies generally. The most obvious analogue of a federal structure is that provided in the United States constitution, with which some hon. Members will be familiar, at least in outline. The United States has separate state governments and an overarching federal Government, each of whom have different duties and functions, none of which overlap or interlink.

The government of Texas, for example, are not required to report their budget to Washington, to seek approval of or to validate their actions. The state, in performing its own duties and functions, proceeds as an entirely separate and independent entity.

Mr. Paul Tyler (North Cornwall)

Does my hon. Friend agree that a characteristic of good law is that it should be fully operable for the foreseeable future? Is it not beyond a mere possibility that, in the next few years, at least one of the other parties might seek to adopt such a structure? At least one of those parties believes in subsidiarity, which is another feature of a good federal structure, whereas the other has promoted devolution across the United Kingdom and might well move in that direction itself.

Mr. Stunell

I thank my hon. Friend for his comments, which are particularly apposite. When I deployed that argument in Committee, the Conservative spokesman, the hon. Member for North Dorset (Mr. Walter), said that the point of view that I was expressing resonated with his Conservative colleagues in Scotland.

To develop the United States analogy a little further—perhaps beyond the point that the House would prefer—the latitude provided to states extends even to whether they should have the death penalty and, if so, how it should be implemented. The United States provides freedom to states to take decisions within the bounds of the powers that they possess. That is the essence of the federal structure. Simultaneously, however, the United States federal Government have duties and powers that apply in every state.

The United States analogy is appropriate in considering the position of the Liberal Democrats. We have a federal party that covers England, Scotland and Wales. Within the federal party, we have state parties for Scotland, for Wales and for England, each of which has an entirely separate range of functions.

Our difficulty with the Bill is that it requires a reporting link from the state parties to the federal party. To fulfil the Bill's requirements as they stand, we would be required to build in reporting links, responsibility links and, ultimately, the power for the central party to overrule an act proposed by a state party. We would have to do that to comply with the Bill, but it would completely undermine the concept of a federal party and of federal government. That is why we have tabled this group of amendments.

When a party's convenience and common practice conflict with a Bill's provisions, it is entirely proper for Liberal Democrats—or our Conservative, Labour or other colleagues—to amend their practice to conform with the legislation. We are not simply seeking an excuse to continue ancient ways that happen to be convenient. When it is necessary to change to secure good practice, we fully accept that we should make that change. I should add that our party federal headquarters has been notifying our constituency and regional parties of precisely what changes they will have to make.

Conversely, however, we ask the House and the Government to give serious consideration to how the Bill might be adapted to permit us to continue our form of federalism. In Committee, I moved amendments designed to achieve that aim. The Minister, and civil servants, quite properly came back to me to say, "That's fine, but it is not guarding against abuse." Perhaps some less scrupulous party might seek to set itself up as a federal party to bypass the sensible provisions for the prevention of abuse.

That brings me to the amendments. Amendments Nos. 177 and 178 outline a process by which a party could register with the Electoral Commission the fact that it intended to have a federal structure and specify the form for that. Amendment No. 179 sets that out in detail. There would be no self-certification. The party would have to establish clearly that it had a bona fide federal structure. The amendment explains the characteristics of that in language that I hope is simple and legally effective.

Perhaps the most important amendment in the group is No. 181, because it defines how we would ensure that there was no advantage in pretending to be a federal party in order to bypass the financial restrictions and limits in the Bill. We have supported all the financial restrictions and limits. Later, I shall support amendments tabled by the hon. Member for Battersea (Mr. Linton) which would reduce the limits. We do not have a problem with the existence of the limits.

In discussions outside the Committee, the Minister pointed out the difficulty that our original amendments, at least on the face of it, would have entitled each layer to the full limits applicable to a party. That would effectively double the limits available. We do not want that and neither, understandably, do the Government. That is where amendment No. 181 comes in. It says that if a party has a federal structure approved by the Electoral Commission and in accordance with the other amendments, any applicable national limit should be divided into two equal parts, with one half attributable to the federal party and the other half attributable to the other bodies. In our case, those other bodies do not cover the whole of the United Kingdom, but relate to Scotland and Wales and regions of England. Their share of the second half would be in proportion to the number of constituencies within them.

Mr. Grieve

Do I take it that, under the system that the hon. Gentleman is putting forward, there could be no transfer of surplus funds from one part of the federation to another? If one area did not use up to its limit, would the other area be unable to benefit?

Mr. Stunell

As the amendments are drafted and as the rest of the Bill stands, it would be proper for a party to contribute to another party, as it would be, for instance, for a constituency party with the unitary construction permitted by the Bill to contribute to a national campaign, or vice versa. Nobody can trespass the limits that are set for their level. If they do, they will carry the can for that liability, rather than it transferring to a different level.

I fully accept that there may be some more drafting work to be done on our amendments, that there may be some avenues that I have failed to explore or loopholes that may appear. Our amendments are designed to take forward the discussion that we had in Committee and address the concerns and issues that the Minister and his civil servants brought to our attention. I hope that during this debate and the subsequent discussion that the Minister has generously offered, we can advance the argument a little further.

We are keen for the Bill to be enacted. We do not want to be the grit in the machine. We regret that we have introduced some complexities that the Minister probably could do without, but we consider this to be matter of principle. It has considerable ideological significance and real political importance, especially for our colleagues in Scotland, who operated in a much looser political framework in the past. We are happy that that framework has been drawn into the federal structure, and we should be most reluctant to see that structure broken now.

9.15 pm
Mr. Grieve

I shall not detain the House, save to say that the official Opposition do not want to stand in the way of the Liberal Democrat party's constitutional niceties. It would be churlish of us to object if it suited those niceties to require some alteration to this part of the Bill.

I remain uneasy, however, and my anxieties do not find a clear answer in the Bill. I intervened on the hon. Member for Hazel Grove (Mr. Stunell) to suggest that the amendment could be to the manifest disadvantage of his party, or of any federal party. I assumed that it would mean that the usual flow of funds during a campaign to those areas thought to need more funds could not cross the federation's internal boundaries. The hon. Gentleman then persuaded me that the Bill provides for the transfer of gifts between political parties.

That illustrates the complexities involved in this matter. Moreover, I know that the Liberal Democrat party has links with the Alliance party in Northern Ireland. Although we shall not discuss it tonight, the question of Northern Ireland—and how to deal with it—arises. That problem has caused great concern to hon. Members of all parties.

For that reason, I shall listen very carefully to the Minister's response. Adjustments without downsides should always be made, but I am still not sure how the amendment squares with some of the other provisions—even though I have read the Bill 150 times.

Mr. Syms

I started off being sympathetic to the amendment, but then began to wonder—perhaps because my knowledge of the constitution of the Liberal Democrat party is lacking. However, although I can understand the amendment's application to Scotland, Wales and England, I cannot understand how the regions could be separated out. My hon. Friend the Member for Beaconsfield (Mr. Grieve) was worried about how money could be ring-fenced, and I share his disquiet.

I presume that the Liberal Democrats would register as one party under the Bill. Some line of authority must run through even a federal political party. If a party registers as a federal party, will it have to register as one party, or several?

Mr. Stunell

We would register as one political party, within a federal structure. For example, the United States is one country, but each state is separate. Perhaps the hon. Gentleman and I could explore the point in more detail over a cup of coffee in the Members' Tea Room.

Mr. Syms

The United States is an interesting example, but this country remains a basically unitary state, with the exception of Scotland.

Mr. Stunell

I apologise to the hon. Gentleman for intervening again so soon, but I want to draw a clear distinction between country and political party. The political party's structure is a matter for its internal organisation and its views. A party can have a federal structure in a unitary country, if it so wishes, and the Liberal Democrat party does so wish.

Mr. Syms

I understand the hon. Gentleman's point. I understand that the Liberal Democrats are organised in the way in which they would like to organise the state. It is a perfectly respectable point of view, but unfortunately we are not organised in that particular fashion.

I think that, in so far as it is possible to accommodate the needs of a responsible and major political party, we should try to do so. However, I think that this may be one of those instances in which there are issues under the surface—issues that may not be entirely obvious—and that, especially given the regional structure in England, it will be difficult to incorporate the proposal in the Bill. I shall, however, be interested to hear the Minister's view.

Mr. Tipping

The hon. Member for Hazel Grove (Mr. Stunell) said that there had been quite a dialogue about this issue—and it is a difficult issue, as was pointed out by the hon. Member for Poole (Mr. Syms), who is new to our discussions on the subject.

The hon. Member for Hazel Grove raised the matter in Committee, and we had a helpful meeting involving Liberal party officials on 27 January. I am grateful to the hon. Gentleman for writing to me last week, on 7 March, describing the way forward as he saw it. Let me add, somewhat mischievously, that I think his letter took longer to write than we had anticipated—but no doubt that reflects the real difficulties that exist. In any event, the hon. Gentleman has taken the opportunity to explain the problem tonight. It is not just a Liberal Democrats issue; there have been representations from the Green party.

Mr. Grieve

Once a proposal of this kind was enshrined in law, it would surely be open to parties to organise on a village basis, and to register several thousand parties in a federation. It is a theoretical possibility, but it must be a possibility.

Mr. Tipping

I shall deal with the Government's view of the amendments shortly, but it would clearly be possible to devolve to a very low level. There are different ideas between and within parties about the extent to which it would be possible to devolve. I am quite radical: for instance, I believe strongly in home rule for Hucknall and for north Nottinghamshire.

I want to be positive and helpful. The hon. Member for Hazel Grove spoke of dialogue and the need to make progress, and I am keen to do that, but I think that the amendments involve fundamental problems, not least the problem of what an approved federal party structure means. Presumably it means a structure that the Electoral Commission has agreed, but the amendments do not provide a framework to help the commission to decide what such a structure might be.

I should also point out—as, indeed, did the hon. Gentleman—that parties will need to adapt to meet the new requirements. The hon. Gentleman acknowledged that his party was considering that, and that it, along with the other parties, would have to make changes. Let me repeat that I am trying to be helpful. I note that the hon. Gentleman's party has made changes to its "federal structure" to meet the provisions of the Registration of Political Parties Act 1998, and that, although it is a "federal" party, there is an official in the party who signs the forms for candidates throughout the United Kingdom. That shows how parties can change to meet the requirements of new legislation.

The scale of the problem involved in the registration of political parties, however, pales into insignificance when we deal with financial matters. It is important that we look at how we change the parties ourselves and acknowledge that federal parties are important for our political structure. Given the significance of the Liberal Democrat party and the Green party, it is important to find a solution. The hon. Member for Beaconsfield (Mr. Grieve) suggested that the issue had ramifications for Northern Ireland. The Government have not been in a position to bring forward amendments on separate registration in Northern Ireland because we need to crack this problem first. This problem spills over into Northern Ireland.

I should like the opportunity to examine further the proposals put before the House by the hon. Member for Hazel Grove and which he submitted last week. Secondly, I would like to arrange a meeting between Home Office and Liberal Democrat officials. Following that, I should like to arrange a more political meeting involving the hon. Gentleman and other colleagues to try and find a way forward.

This is a difficult issue. I assure the hon. Gentleman that we are keen to find a solution. It is important that the Liberal Democrats, the Green party and other parties are not disadvantaged. We will work with him to take this matter forward. I would be pleased if I could guarantee to find a solution, but I cannot. However, I guarantee that over the next few weeks we will work with him and his colleagues to find a solution to what is a very important issue for the Liberal Democrat party. With that assurance, I hope that the hon. Gentleman will feel able to withdraw the amendment.

Mr. Stunell

I thank the Minister, and other right hon. and hon. Members who have contributed to the debate. The Minister is right to say that it took some time for us to formulate an appropriate response following the meeting. I am sorry if that caused increased difficulties for him and his officials. We now have, we hope, the basis of a good development of ideas and proposals for the Bill.

The hon. Member for Beaconsfield (Mr. Grieve) referred to 1,000 village parties. I shall look carefully at my amendment, because it did not specifically mention them.

Mr. Grieve

I appreciate that that was not what the hon. Gentleman was proposing for his own party, and that the structures were likely to be based on the various national component parts of the United Kingdom or on regions. I simply made that point to illustrate how small the groups could be under his amendment.

Mr. Stunell

I understand the hon. Gentleman's point. It is an interesting one, which further discussion and research could explore to the full.

Amendment No. 179 addresses the hon. Gentleman's point to some extent, and begins to address the Minister's point about what is an approved federal structure. It cannot be self-defining; it has to be approved. The wording of the amendment may be insufficient to specify what it should be. At its limit, it could affect an individual constituency party, although the practical difficulties of that would defy even the Liberal Democrats. The amendment attempts to address the point, and I hope that further discussion may move us forward.

9.30 pm

The Minister made the perfectly fair point that the Liberal Democrats have one person reporting on political party registration. That turned out not to be a terribly challenging point; the question was whether we could have a bird as a logo, a point not of the essence when it comes to whether we should have to report back on spending in future on elections or on political activity at any other time, which would entirely dismantle our federal structure. The Minister understands that point; a step designed to offer the minimum trouble for the approval of a bird as a logo is not quite the same thing.

I welcome the fact that the Minister said that he would take time to consider our proposals and that he wants meetings between officials and political meetings. One reason for delay is that our elected officials have changed, which has made the job more complex. However, we welcome what he said. I wanted to put on the record an issue important to us, but our hearts remain strongly with the Bill, with which we want full compliance. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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